Shoppers’ personal info not part of RadioShack sale

(Reuters) – Personal information gathered by RadioShack Corp from shoppers is not included in its sale, the consumer privacy ombudsman in the electronics retailer’s bankruptcy case said in response to concerns shared by several states that the data could be sold.

If that changes, Elise Frejka also said in a letter on Wednesday to U.S. Bankruptcy Judge Linehan Shannon she would file a report with recommendations based on specific facts and circumstances.

Her letter came as Oregon and Pennsylvania on Wednesday joined Texas and Tennessee in objecting to RadioShack selling names, email addresses and other personal information gathered from shoppers.

Personally identifiable information of 117 million consumers could be made available in RadioShack’s proposed sale, Oregon Attorney General Ellen Rosenblum said in a filing that urged stripping out information such as telephone numbers and mailing addresses from assets.

In a separate filing, Pennsylvania Attorney General Kathleen Kane said selling the information would violate parts of her state’s Unfair Trade Practices and Consumer Protection Law.

Texas Attorney General Ken Paxton last week objected to the sale of personally identifiable information and requested RadioShack’s buyer be required to set a separate price for it.

Paxton said RadioShack’s privacy policy for shoppers included an “unequivocal” provision the information would not be sold. Its sale runs afoul of the Texas Deceptive Trade Practices Act, he added.

Tennessee Attorney General Herbert Slatery III filed a supporting objection on Monday, and New York Attorney General Eric Schneiderman expressed concern on Wednesday.

“We are committed to taking appropriate action to protect New York consumers,” Schneiderman said in a statement.

Officials in Arizona, Minnesota, Mississippi, North Carolina, North Dakota, Ohio, Oklahoma and Virginia are also concerned, according to Paxton’s office.

RadioShack, forced into Chapter 11 bankruptcy in February by competition from online and bricks-and-mortar rivals, was not immediately available to comment.

A private auction for RadioShack began on Monday. Its preferred bidder is the hedge fund Standard General, which would keep about 1,740 of RadioShack’s more than 4,000 stores open as part of a tie-up with wireless operator Sprint Corp.

Salus Capital Corp, one of RadioShack’s lenders, says it has submitted a rival bid with three liquidators offering $271 million in cash.

Salus was not available for comment on RadioShack’s shopper information and a Standard General spokesman declined to comment.

RadioShack’s bankruptcy auction may include your personal data

If you shopped at RadioShack before the company started closing its stores en masse earlier this year, your personal data could be up for bid in the company’s bankruptcy auctions.

More than 13 million e-mail addresses and 65 million customers’ names and addresses are included in the RadioShack auctions that began this week, Bloomberg reports. The data trove could also include information about shoppers’ buying behavior.

However, two separate legal challenges could prevent RadioShack from auctioning off customers’ data. Texas Attorney General Ken Paxton argues RadioShack agreed not to sell customers’ data, while AT&T says some of the company’s data about shopping habits actually belongs to the telecom company, Bloomberg notes.

Whether or not RadioShack survives the bankruptcy process depends largely on whether a federal bankruptcy court approves what’s said to be a successful bid for the company’s assets by hedge fund Standard General. RadioShack said when it entered bankruptcy last month it planned for Standard General to take over up to half the company’s retail locations and turn them into stores for Sprint cellphones. The court’s decision on approving or rejecting Standard’s bid is expected later this week.

RadioShack’s sales dipped 16% in its last quarter with losses spanning 11 consecutive quarters. The company said in its Chapter 11 filing that it had $1.2 billion in assets along with $1.39 billion in debt.

GameStop nabs 163 RadioShack leases for Spring Mobile push

GameStop may sharply increase the number of its Spring Mobile stores after the company bid on Wednesday for the right to take 163 leases over from electronics retailer RadioShack Corp, which filed for bankruptcy this month.

The agreement allows GameStop to decide in about two months if it will take on the obligation of the RadioShack leases or terminate the lease, according to a filing in the U.S. Bankruptcy Court in Wilmington, Delaware.

The video game retailer said it had agreed to pay $15,000 for each RadioShack RSH store lease.

“We can confirm that GameStop has submitted a bid to acquire a select number of RadioShack’s U.S. leases,” said an email sent on Thursday from GameStop spokeswoman Jackie Smith. “If awarded these leases the locations would be primarily used to expand the retail footprint of our Spring Mobile business, which is an exclusive AT&T dealer.”

On Friday, RadioShack will ask U.S. Bankruptcy Judge Brendan Shannon to approve the agreement with GameStop, which had 311 Spring Mobile stores as of its most recent quarterly regulatory filing in November. GameStop has focused on expanding Spring Mobile and Simply Mac, a retail chain which sells Apple AAPL products.

Despite the sale to GameStop, RadioShack largely came up empty at Wednesday’s lease auction. The chain was selling leases to 1,100 stores that it is abandoning this month, and court documents showed only four other leases drew bidders.

RadioShack’s proposed sale worth $200 million; GameStop eyes stores

RadioShack’s RSH sale of about 2,000 stores to a hedge fund is worth $200 million, an advisor to the electronics retailer told a U.S. Bankruptcy Court on Wednesday.This was the first time the bankrupt company has put an estimated value on the sale agreement with Standard General, which will keep about half of RadioShack’s stores open and operate them under an agreement with Sprint S.At the same hearing, RadioShack lawyers said the company had received bids for leases to 205 of the 1,100 locations it plans to close this month, including interest from a unit of the GameStop GME retail chain.The lawyers also said the company’s name and intellectual property would be auctioned separately and that Standard General agreed to an initial bid of at least $20 million.RadioShack filed for bankruptcy earlier this month after struggling for years with falling sales in the face of online competition.

On Wednesday, RadioShack’s lawyers asked U.S. Bankruptcy Judge Brendan Shannon in Wilmington, Delaware, for approval of an auction process that would allow other potential buyers to challenge the sale to Standard General. The hearing was still under way in the afternoon.

Standard General is planning what is known as a “credit bid,” using the $55 million it is owed on RadioShack loans to help pay for the stores.

Standard General also plans to offer loans held by other hedge funds, which could bring its credit bid to $130 million, according to David Kurtz, who heads up the restructuring practice of the Lazard Ltd, which is advising RadioShack.

He said Standard General would bid $75 million in cash.

RadioShack’s lawyers said the company was slowing the sale process to ease creditors’ concerns that rushing it would discourage potential buyers. The company had planned to hold the auction no later than March 16 but postponed it to March 23, with a hearing to approve the sale now set for March 26.

While Wednesday’s hearing was under way, RadioShack was holding an auction for the leases to the 1,100 stores it will close this month.

RadioShack lawyer Tom Howley said GameStop’s Spring Communications was interested in some locations and called this a “significant development” without elaborating.

GameStop has been aggressively expanding its Spring Mobile business, which sells AT&T cellphones.

It’s time for a musty old 80s relic to call time. The troubled electronics retailer RadioShack — which is actually nearly 100 years old — has finally filed for bankruptcy, and will be selling many of its stores to General Wireless, which will in turn set up “stores within stores” for cellular provider Sprint, reports Fortune’s Phil Wahba. So go buy some batteries, and pour some out for RadioShack.

2. Hiring picks up.

The latest jobs report, released Friday morning, shows U.S. employers picked up the pace of hiring last month, with a rebound in wages, supporting views that the labor market and the broader economy are moving closer to full health more than five years after the recession. U.S. employers added 257,000 jobs in January, while the nation’s unemployment rate ticked up to 5.7%.

3. Twitter gets results.

It was a good day for Twitter yesterday. The social networking site reported a 97% jump in revenue, and shares shot up on the news, despite the fact that the company is still not profitable, according to Fortune’s Erin Griffith. Twitter has 288 million active monthly users, a 20% increase over last year. The upbeat reaction on Wall Street will temporarily take the heat off embattled Chief Executive Dick Costolo, analysts said.

4. Greek theater.

Following the recent election of left-wing party Syriza, Greece has been all international economists have been able to talk about lately, and on a trip to Germany yesterday, Finance Minister Yanis Varoufakis gave them something to talk about, as he and his German counterpart squabbled over how to solve Europe’s debt crisis. Expect more political theatre in the days and months ahead as Varoufakis seeks to drum up support for Greece’s plan to renegotiate its massive international bailout.

5. Anthem facing lawsuits.

On Wednesday night Anthem, the second-largest health insurer in the United States, announced that it had succumbed to a massive cyber attack. It may be the largest hack to hit the health care industry to date. Now Anthem is reportedly facing the first of many potential consumer lawsuits, Bloomberg reports. The hack could have exposed social security numbers and other personal information of up to 80 million users. And it gets juicier: Bloomberg is also reporting that some people close to the situation believe it is the work of Chinese state-sponsored hackers.

After 94 years, RadioShack may be about to pull the plug

Troubled electronics retailer RadioShack is reportedly close to filing for bankruptcy and is in talks to sell half of its more than 4,000 stores to Sprint while shuttering its remaining locations.

That’s according to Bloomberg, which cites anonymous sources in reporting that the Fort Worth, Texas-based retailer is close to a deal that would see the RadioShack RSH locations sold to Sprint S operated under the wireless carrier’s name. Under those terms, the deal would represent the end of RadioShack’s existence as a stand-alone retailer once the rest of its locations are closed. The deal is not yet finalized and could still fall apart, or the two companies could agree on a co-branding arrangement, Bloomberg’s report noted.

The online retailer is thinking about using the defunct RadioShack stores as showcases for its hardware, as well as potential pickup and drop-off centers for online customers, the report said.

The New York Stock Exchange said late Monday that it would delist Radio Shack’s shares. The company has fallen below the required threshold of a $50 million market capitalization or an equal amount of shareholder equity for 30 consecutive trading days. The exchange said that Radio Shack does not intend to submit a business plan to address the problem.

In January, The Wall Street Journal reported that the 94-year-old RadioShack was preparing to file for Chapter 11 bankruptcy protection by February after reporting losses in each of the last 11 quarters. The chain reported worse-than-expected losses in September and required help from hedge fund Standard General, which led a financing that helped RadioShack continue operating through the holiday season.

Now, The Journal reports that Standard General, which became RadioShack’s biggest shareholder last year, is in talks to be the lead bidder in the troubled chain’s potential bankruptcy auction. The Journal cites anonymous sources in reporting that Standard General could become the so-called stalking horse, or the first bidder, in a court-supervised auction of RadioShack’s assets. The hedge fund could also potentially purchase a slimmed-down RadioShack that has fewer stores, the paper said.

RadioShack’s stock fell during Monday’s trading session and is down nearly 90% in the past year.

RadioShack prepares to file for bankruptcy

(Reuters) – Electronics retailer RadioShack is preparing to file for bankruptcy protection by next month, the Wall Street Journal reported citing people familiar with the matter.

Texas-based Radioshack is in talks with a private-equity firm that could buy its assets out of bankruptcy, the Journal reported, citing sources.

The talks may not produce a deal, and RadioShack may opt for other debt-restructuring options that do not include a sale, the Journal said.

RadioShack has reached out to potential lenders that could provide a loan to fund its operations during the bankruptcy case, the Journal added.

RadioShack was not immediately available for comment.

The retailer, which reported a bigger-than-expected third-quarter loss last month, warned in September that a bankruptcy filing was a possibility.

Salus Capital Partners had said it would provide $500 million to RadioShack in a kind of debtor-in-possession loan used by companies to fund operations in bankruptcy, the Wall Street Journal previously reported.

RadioShack hires advisory firm, names new interim CFO

RadioShack has tapped an advisory firm and named a new interim chief financial officer, moves that come less than a week after the struggling electronics retailer unveiled a cost-cutting plan in the wake of another poor quarter of sales.

RadioShack RSH said it has retained FTI Consulting for advisory and interim management services and in connection with that agreement, has appointed Carlin Adrianopoli as interim CFO. He succeeds interim CFO Holly Etlin, who was only appointed to that role in September after the prior financial chief resigned with less than a year on the job.

The new CFO and advisory firm are on board to help RadioShack navigate a difficult turnaround. RadioShack, which is in the midst of a high-profile tussle with loan providers, has reported slumping sales and is on track to report a third consecutive annual loss as it struggles to compete with larger rivals like Best Buy BBY. Shares are worth less than 50 cents today, signaling many investors haven’t bought into the company’s promises to cut costs by over $400 million annually to help bolster the bottom line performance.

Adrianopoli has been a senior managing director in FTI’s corporate finance/restructuring practice since 2010 and first joined FTI in 2002. His services are billed by FTI Consulting, and he will not be compensated separately by RadioShack, the company said in a securities filing.

RadioShack unveils a cost-cutting plan as its losses deepen

Beleaguered electronics retailer RadioShack RSH reported a wider third-quarter loss as net sales tumbled 16% due to store traffic declines and weakness in the mobility business. Here’s what else you need to know about the company’s earnings report.

What you need to know: RadioShack, which is in the midst of a high-profile tussle with loan providers, reported a 13% slump in same-store sales for the latest quarter, a decline that was mostly due to weakness in the postpaid mobility business. RadioShack attempted to strike a bullish tone by pointing out that the “retail segment,” the half of its business that isn’t mobility, has performed better in the third quarter and during the key Thanksgiving holiday weekend. But it is still troubling that RadioShack posted a double-digit drop in overall same-store sales, especially after larger rival Best Buy BBY recently reported a surprise 2.2% increase in U.S. same-store sales for its latest quarter.

The big number: RadioShack’s quarterly loss swelled to $161.1 million from a loss of $135.9 million a year ago. The company’s total liabilities are at $1.39 billion with total assets of just $1.2 billion (as of February of this year, the retailer had slightly more assets than liabilities). Fitch Ratings on Thursday said that RadioShack’s five-year credit-default swaps have reached their widest levels ever, and said “mounting market concern for RadioShack comes amid speculation over whether a failure to pay credit event has occurred.”

What you might have missed: RadioShack has been in trouble for quite some time, as it is on pace to report its third consecutive annual loss as the seller of mobile devices, accessories and other consumer electronics faces steep competition from larger rivals that sell the same products but typically with a wider selection. RadioShack CEO Joseph Magnacca on Thursday promised cost-cutting efforts that would boost earnings “by over $400 million annually,” including efforts to trim expenses at the company’s headquarters as well as close some locations. While cost-cutting is important, it is also interesting to note that RadioShack’s net loss for the first nine months of the current fiscal year already totaled nearly $400 million, and Wall Street analysts expect the company to lose more than $100 million in the key fourth quarter.

RadioShack is also finding itself distracted by an argument about the terms of a $250 million loan that was provided by Cerberus Capital Management and Harbinger Group. Magnacca earlier this month said that the lenders “have repeatedly blocked our efforts to accelerate and intensify our turnaround and make smart decisions for our business.” One area of contention: RadioShack has repeatedly requested that the lenders sign off on the closure of up to 1,100 stores, but hasn’t yet won approval for that move.

Which retailers will sing a Black Friday swan song?

A season of giving isn’t enough for some retailers. A few struggling companies are in need of a holiday miracle.

“The overall landscape in retail has had no real growth in earnings since 2009,” says Monica Aggarwal, senior director and head of U.S. retail at Fitch Ratings. People are cutting back on purchases on iPads and iPhones, she says. “In the past year, sales haven’t grown that much, and where they have, they have grown online.”

That’s presented a major challenge for many mall retailers—those that depend on customers to traipse into their stores when they are moseying down the halls. Though some might be able to power through by downsizing, a couple might have to close shop altogether. Here is a breakdown.

American Apparel

The bad news: American Apparel’s APP sales declined 5% last quarter, compared to the same period last year, and it continues to turn out losses. It has about $20 million in excess cash and debt, but the retailer blew through $12 million in the six weeks between the end of September and November. At this rate, a quick and tidy turnaround plan is a must.

The good news: The company still has positive and growing operating earnings, partly powered by its international wholesale operations. That helps explain why Standard General, the hedge fund (also invested in RadioShack), recently took a big stake and a lead management role with the company. Standard General and others are set to give the firm another $15 million cash infusion. Given this vote of confidence, the company can plug along.

Swan Song likelihood: Extremely low.

Abercrombie & Fitch

The bad news: Though the company won’t officially release full third quarter earnings until early December, its recent revenue update does not bode well. Top line fell 12% in the first quarter, below previous guidance. In the previous quarter, it burned almost $290 million in cash, about half the amount it had resting on its balance sheet. The cash burn could easily be the same or worse when the company reports earnings for the recent quarter.

The good news: Abercrombie ANF received a $700 million lifeline in August and has $311 million in cash on its balance sheet. That should be enough capital to get through the next few quarters. While the company’s stock price has been cut by a third since August, it still has about $2 billion of equity value, a bit of a cushion from shareholders.

Swan song likelihood: Low.

Aeropostale

The bad news: Without a doubt, Aeropostale ARO is struggling. Revenue fell 12% in the most recent quarter ended in August. The retailer posted losses of $64 million, 50% more than the previous year. What’s worse, the company has about $40 million in debt it can draw off. It blew through nearly $90 million in its second quarter alone, two-thirds of a loan it received in May.

The good news: The company has been taking steps to conserve cash. It is closing 125 stores and is streamlining expenses. This downsizing is reflected mostly in the company’s stock price, which has been cut by two-thirds in the past year. The company has declining operating profit, but it is still positive, suggesting that if it did restructure, there is enough value to save it rather than liquidate the business altogether.

Swan song likelihood: Pretty low.

JCPenney

The bad news: The company is on its 9th life. Though returning CEO Myron Ullman is pushing hard on a new strategy, the retail chain continues to post losses. Sales declined once again in its most recent quarter, which disappointed shareholders. Operating cash flow is positive, but just barely, after taking out gains from a sale of assets.

The good news: Operating performance is improving and declines in sales have slowed dramatically, suggesting that JCPenney’s JCP turnaround plan is working. The company is looking toward the future in other ways. The board has hired Home Depot’s Marvin Ellison to run the company starting August 2015, suggesting it has no intention of closing down. The turnaround plan will work if the firm doesn’t run out of cash first.

Swan song likelihood: 50/50.

RadioShack

The bad news: Standard General’s $120 million loan, given in October, might be seen as a vote of confidence for the electronics retailer. But the hedge fund can still make money if RadioShack goes bankrupt and is liquidated. Its loan is backed by inventory and receivables, according to Fitch. Both those pieces of collateral should cover Standard General’s loan in a liquidation. The loan is no more than a last ditch lifeline for the company to make it through the holidays.

Given that RadioShack’s RSH earnings before interest, tax, depreciation, and amortization are deep in the red, there isn’t much value to save once it runs out of cash. When that happens, RadioShack will almost certainly close down.